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Jiangsu Lianhe launches 300t/a carfentrazone-ethyl productionSummary: Jiangsu Lianhe launches 300t/a carfentrazone-ethyl production in Oct. 2012.Tag: Lier Chemical subsidy Jiangsu Kuaida asset reorganization technological transformationClodinafop-propargyl Diuron Paraquat export Indonesia Jiangsu CF 2,4-D Jiangsu Lianhecarfentrazone-ethyl Diquat AtrazineRecently, Jiangsu Lianhe Chemical Technology Co., Ltd. (Jiangsu Lianhe) announced that its300t/a carfentrazone-ethyl technical project had got complete check from EnvironmentalProtection Agency of Yancheng City on Oct. 17, 2012 and the 300t/a carfentrazone-ethyltechnical production line has been launched in Jiangsu Xiangshui Chemical Industrial Park ofXiangshui County, according to CCM’s November Issue of Herbicides China News.Revealed from Jiangsu Lianhes announcement, the company totally invested about USD24.3million (RMB152.05 million) on the project, and thereinto about USD1.6 million (RMB9.8 million)was invested on environmental protection. In fact, on April 29, 2011, Jiangsu Lianheaccomplished the additional public issue of 19,295,700 shares, and the additional capital (aboutUSD103.7 million/RMB648.0 million) raised was invested into two projects which include a seriesof pesticide and intermediate production lines, such as carfentrazone-ethyl.It seems that carfentrazone-ethyl project was pushed slowly. In fact, the 300t/a carfentrazone-ethyl trial production was finished in Feb. 2011. After the trial run, the production line had been indebugging in Jiangsu Lianhe till Oct. 2012 when the project was put into operation. (HerbicidesChina News 1104: Lianhe Technology initiates carfentrazone-ethyl production)In an estimate, Jiangsu Lianhe takes a conservative attitude towards the new product,carfentrazone-ethyl, although the company got a nice performance in H1 2012. According to thesemi-annual report of Jiangsu Lianhe released in July 2012, its net profit has reached aboutUSD21.6 million (RMB135.1 million) in the first half of 2012.Jiangsu Lianhe considers that the new product may face risks after being launched to the market,because Jiangsu Lianhe cant sure that the quality and profit of this new product are able to helpthe company gain a leading position. In addition, whether the new product can adapt to thechanges in market demand is uncertain.At any rate, the 300t/a carfentrazone-ethyl capacity makes Jiangsu Lianhe outstanding amongother Chinese carfentrazone-ethyl pursuers. Furthermore, Jiangsu Lianhe enjoys self-supply of o-

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fluoroaniline, the raw material of carfentrazone-ethyl, and can lower the production cost in thecarfentrazone-ethyl production. Besides, the company can also extend its production chaintowards downstream production by producing carfentrazone-ethyl. As a result, Jiangsu Lianhesprofit room in the future is expected to be larger.Its suspected that Jiangsu Lianhes carfentrazone-ethyl production is run as the companyscustomized manufacturing services. As the developer of carfentrazone-ethyl, FMC Corporationhas stable cooperation relationship with Jiangsu Lianhe. Naturally, FMC Corporation isconsidered as one of Jiangsu Lianhes potential clients of this new product.As of Oct. 2012, there are five companies with carfentrazone-ethyl technical registration in China,according to the Institute for the Control of Agrochemicals, Ministry of Agriculture (ICAMA),namely Jiangsu Lianhe, Jiangsu Baozong & Baoda Pharmachem Co., Ltd. (Jiangsu Baozong &Baoda), Shandong Cynda Chemical Co., Ltd., Luzhou Dongfang Agricultural Chemical Co., Ltd.and FMC Corporation.In fact, carfentrazone-ethyl has only a few pursuers in China currently due to technologicalbarriers. Although the administrative protection of carfentrazone-ethyl technical patent in China(the administrative protection number: NB-US99010415) has expired for almost five years since2008, Chinese pursuers still cant master the production technology of carfentrazone-ethyl bynow. Moreover, the high price of carfentrazone-ethyl drags down its consumption in China. InNov. 2012, FMC Corporation quoted the 40% WG at about USD0.21 million/t (RMB1.3 million/t).Besides Jiangsu Lianhe and FMC Corporation, only Jiangsu Baozong & Baoda ownscarfentrazone-ethyl technical production line. In addition, Jiangsu Baozong & Baoda plans toexpand its carfentrazone-ethyl technical production line from 160t/a to 300t/a and this productionline has got the EIA acceptance by Nantong Environmental Protection Bureau on June 26, 2012.Its predicted that carfentrazone-ethyl will become another profit growth point of Jiangsu Lianhe.Although carfentrazone-ethyl has brighter prospect for its excellent effect, in a short time, therewill be only a few carfentrazone-ethyl manufacturers in China due to the technological barriers.As a result, Jiangsu Lianhe can maintain relatively high profit on that product.Carfentrazone-ethyl, a post-emergent triazolinone herbicide, is usually applied in the fields ofwheat, rice, corn, etc. Contributed by high selectivity and excellent effect, 40% carfentrazone-